The most common problem a government faces is not having enough money to meet the unlimited needs of its citizens. But the Spanish Government is now facing an extraordinary problem: it has a lot of money (a total of 163,000 European funds in subsidies and loans), but it has difficulty spending it within the deadline set by the European Commission (before June 2026). This is both due to quality demands on expenses and Healing and Endurance Mechanism The inadequacy of the EU (MRR) as well as the Spanish administrations (state, regional and local) in managing such a large amount of public investment calls within a limited period of time.
However, Brussels gave the Spanish government some oxygen by allowing some investment blocks in its investment programs to be implemented after 2026. electric car, green hydrogen, decarbonization in industry And circular economy for approximately 5 billion euros.
Modified Recovery Plan
In total, modified rescue plan Spanish, which received approval from the European Commission on October 2, allows Spain to qualify for $79.8 billion in subsidies from European funds. New Generation EU and to the mechanism Re-strengthen the EU and another 83 billion MRR loans. (almost 163.00 million in total).
The planned investments are Recovery and Resilience Plan Spanish does not escapebefore June 2026 the subsidies attached to them will disappear. To help avoid this risk, the Government has negotiated approval with Brussels to postpone until after 2026 some investments that otherwise risk being derailed. This is a group of projects totaling close to €5,000 million and linked to: green hydrogen (1.6 billion subsidy), circular economy (300 million subsidy), electric car (250 million in subsidies and 1,200 million in loans) and decarbonization in industry (430 million in subsidies and 1,050 million in loans).
It was not easy to obtain an extension to the European Recovery and Resilience Mechanism regulation, which was vetoed and advocated by institutions such as the Bank of Spain (to avoid indiscriminate calls). According to government sources, the formula found with Brussels to extend the period beyond 2026 without contradicting the regulation includes the realization of certain investments through certain channels. public institutions and organizations.
Therefore, the amended Spanish Recovery Plan, which includes a large part of the addendum request that Spain submitted in June, allows this plan to be implemented. Beyond June 2026 investments currently held in trust Enise (National Innovation Corporation), on electric cars and decarbonization; IDEA on green hydrogen and circular economy (Institute for Energy Diversification and Conservation); Yet Biodiversity Foundation (circular economy).
He explains that in all these cases, the granting of aid becomes a milestone that must be met in 2026, not the completion of the project, which can be completed at later dates. Paloma BaenaSenior Director of European Affairs and Next Generation EU LLYC consulting firm.
It’s all about deadlines
“It’s about the deadlines that matter,” emphasizes LLYC’s Paloma Baena. According to him, the pace of Spain’s implementation of the Recovery Plan is “not going badly” in terms of European monitoring. €37,000 million of European funding has already been received, of which 80% (€30,000 million) has been awarded in civil works and services tenders and aid appeals, which have already provided more than 200,000 financings, according to Government data. 500,000 projects investment.
The government delivers the transfers it needs to send on time autonomies and city councils For aid and investment programs. “However, although we do not have all the data on how calls are resolved in the autonomies and municipal councils, this year we see the following: Delays are piling up. We are behind schedule in terms of what we need to achieve,” Baena analyzed.
The proof is that Spain has not yet requested payment of the loan. Fourth aid tranche from European funds (10,000 million), a procedure which the present Government intends to complete as soon as this procedure is completed. European Council of Finance Ministers(Ecofin) will confirm definitively in the coming weeks modified Recovery Plan Spanish, which has already received approval from the European Commission. Spain had planned to submit a request along with the initial payment plan. Two payments in 2023 (17,000 million in total) but early elections made it difficult to deliver on some promised reforms, such as the Civil Service reform. Now you will get the most payment (for the fourth tranche mentioned above, 10,000 million).
Delayed goals
In fact, the new revised plan extends the deadlines for the implementation of some reforms (the target of approval of the mobility law is postponed from December 2023 to June 2026), while others are eliminated (such as the implementation of the toll system on roads) or modified (the Civil Service reform can now be done by decree).
Additionally, in some cases, goals are postponed. call for aid or investment. Therefore, for example, the purpose of construction Green energy storage center in Extremadura (originally planned for the last quarter of 2023). At least the goal of distributing aid 238.00 electric vehicles A new target was set to reach 348,000 vehicles in the third quarter of 2026, with charging points in residential areas and roads. tax incentives For 110,000 new cars. It was also extended for another year until the end of 2025. Digital Kit program, while reducing its target to 670,000 companies (compared to an initial target of one million).
The extension of the deadlines for some of these targets has resulted in a new, more delayed timetable for the disbursement of different tranches of European funds in favor of the Treasury.